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In charts: IMF says India’s direct benefit trasfer scheme is a ‘logistical marvel’

NEW DELHI: The International Monetary Fund (IMF) has called the deployment of India’s direct cash transfer scheme as a ‘logistical marvel’ which has reached hundreds of millions of people.
Paolo Mauro, deputy director of the fiscal affairs department at the IMF, said earlier this week: “In fact, just because of the sheer size of the country, it is a logistical marvel how these programmes that seek to help people who are at low-income levels reach literally hundreds of millions of people.”
Mauro noted that India has enrolled programmes which specifically target women, elderly and farmers. Perhaps the interesting part is that in these examples, there is a lot of technological innovation, he said.
The backbone of the entire cash-transfer programme, Aadhar, was also hailed, as the director praised India’s unique identification system.
This endorsement of India’s welfare scheme comes as the country continues to maintain its position as the fastest-growing major economy in the world.
The IMF, in its latest report, projects India as an outlier, growing at 6.8 per cent in 2022 as other economies across the globe contract.
India’s DBT programme is aimed at transfer of subsidies and cash benefits directly to the people through their Aadhaar-seeded bank accounts. It is hoped that the process of crediting subsidies into the bank accounts would substantially reduce leakages, and associated delays, owing to the flow of fund in a multi hierarchy of administrative offices till it reaches the end beneficiary.
Earlier this month World Bank president David Malpass also praised the Direct Benefit Programme for helping people during the pandemic.
“Helped by digital cash transfers, India managed to provide food or cash support to a remarkable 85% of rural households and 69% of urban households,” Malpass said, asking other nations to adopt India’s move of targeted cash transfer instead of broad subsidies.
Components of DBT
Primary components in the implementation of DBT schemes include Beneficiary Account Validation System, a robust payment and reconciliation platform integrated with RBI, NPCI, public & private sector banks, regional rural banks and Cooperative Banks (core banking solutions of banks, settlement systems of RBI, Aadhaar Payment Bridge of NPCI) etc.
In FY2022-23 s yoysl of 303 crore DBT transactions amounting to Rs 298,101 crore have taken place across 318 schemes.

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With the outbreak of the Covid-19 pandemic and the imposition of lockdown and social distancing norms, DBT emerged as a boon for millions. The Public Financial Management System (PFMS) recorded the highest number of transactions in a single day on 30th March, 2020 of 2.19 crore transactions largely driven by DBT payments.
Cash amounts were transferred using the digital payments technology vehicle, Public Financial Management System (PFMS) under Central Schemes (CS) and Centrally Sponsored Schemes (CSS).
Between March 24 and April 17, the DBT payments under all the central sector/centrally sponsored schemes through PFMS amounted to Rs 27,442.08 crore in the accounts of 11.42 crore beneficiaries through schemes like PM-KISAN, Mahatma Gandhi National Employment Guarantee Scheme (MGNREGS), National Social Assistance Program (NSAP), Prime Minster’s Matru Vandana Yojana (PMMVY), National Rural Livelihood Mission (NRLM), National Health Mission (NHM), scholarship schemes of various ministries through the National Scholarship Portal (NSP).
In addition, states like UP, Bihar, Madhya Pradesh, Tripura, Maharashtra, Jammu & Kashmir, Andhra Pradesh also leveraged on the DBT platform of PFMS.




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